Coffee House

Rising energy bills add to pressure on government

26 October 2012

12:13 PM

26 October 2012

12:13 PM

EDF’s announcement that it is raising gas and electricity bills by nearly 11 per cent will increase pressure on the government in two ways. The first is that these sorts of hikes in the cost of living mean that while ministers have been cheered by recent pleasing statistics on growth, jobs and inflation, voters might not feel as though things are going so well for them. If their own experience of the economy is one where their rent, shopping bills and energy bills are soaring while their wages are frozen, then they may not feel quite as sympathetic to the government as official statistics suggest they should.

The second is that pressure will really now be on ministers to ensure that their policies do not do anything to increase the burden on energy companies, not out of kindness to those giants, but to their customers, who pay for increased regulation through their bills. When David Cameron announced last week that he wanted to force energy companies to give their customers the lowest tariffs, the companies protested that this would cost them a great deal, which would mean their customers would have to pay a great deal more. So even if they were forced to offer the lowest tariff, that lowest tariff would still be higher than they currently charge because of the increased regulation.

Conservatives will also be increasingly vocal about any moves to decarbonise the power sector, when analysis by one backbencher suggests that doing so by 2030 would add £120 extra to bills. This could in turn lead to a stand-off with the Liberal Democrats on green energy policies.

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Show comments
  • Florian Bamberg

    That should make the time until the upcoming energy bill all the more politically interesting. I wrote an analysis on subsidies for green energy, and why the UK should look to Germany for a cautionary tale:

  • eeore

    Remember the rolling black outs that led to the election of Schwarzenegger?

    Cameron is simply reaping what the Conservatives sowed in the 1980’s with their corporatist policy of privatisation. Supposedly this would lead to better service and cheaper prices. Instead the prices rise and the public are fed increasingly weird global conspiracy theories, usually blaming China and India, to justify what amounts to price fixing by a cartel.

    It’s only a matter of time before the lights start going out when the politicians stop playing ball, and the companies will replace the careerist politicos, with celebrities.

  • Realist

    Just what is the aim of these energy companies? To send people completely broke?
    Just when will those who bemoan the lack of consumer spending realise that if people have to find ever increasing sums to meet their basic needs, such as energy, food, travelling costs, etc then the less they have to spend on other commodities they feel they will have to do without? Thus the economy stalls and stagnates causing businesses to fail and unemployment to rise. Moderatiion in price rises seems to be outside the thinking of those who run companies nowadays. It is a crazy situation that is causing considerable anxiety in the community.

  • Barbara Stevens

    I have EDF and I have, well supposed to have, a fixed account till 2013, I hope this remains so. If they try to increase it I shall question it with offgem. We are retired and heating is our biggest bills in winter. How we will pay for both is a worry, but like the rest we have no choice, but thank God for the Internet where we can sort out different companies, many haven’t access. I think the government should fix the top rate of tariffs for companies until they realise the damage they are doing to people’s lives. Many will go cold this winter.

  • ShaleGasExpert

    What’s wrong with UK Energy Prices and how to fix them. Absolutely nothing to do with shale gas by the way, but everything to do with transparency, fairness and putting money in people’s pockets.
    I’ve bought well over a billion pounds worth of energy in my time, and if I say this works: It works.

  • In2minds

    “Most of Europe seems to pay more than we do”, especially Norway!

  • TomTom

    I am pleased that Shareholders and Executives in Utilities have an early Christmas and can celebrate Recovery in style. I am burning coal because gas seems such an expensive luxury and I do wonder whether it is getting to the point of shutting it off. Having been in relatively empty shops this Friday and observed fish and chip shops with lots of unsold fish at lunchtimes I suspect the screw is tightening on those not on the gray train as they try to eat and heat.

    • 2trueblue

      I agree with you about burning coal. I like the fact that I am warm and the bill is already paid!

  • djpv

    The tax breaks announced for investment in shale in the UK will show that we are serious about improving our energy security and bring further competition to the gas market as the EU has failed miserably in breaking the link of gas prices with oil when instead it should be priced by demand and supply.

  • james102

    Looking at a chart of annual electricity bills I see that they have been climbing steeply since 2004.When you consider the changes to weekly earnings over the same period it is no wonder this is becoming an issue.

    We must look to shale gas and nuclear power for the future, not just on cost grounds but simply to ensure the lights stay on.

    • Bob Hill

      I agree with your ideas on nothing else..but we are in accord on this one

      • Bob Hill’s Doppelganger

        Pffffffffffffff! Bob strikes again!

    • Daniel Maris

      New nuclear is incredibly expensive – not cheap. It’s more expensive than land-based wind.

      • 2trueblue

        Nuclear is reliable once up and running, whereas wind is not. On the coldest days the propellers rarely move.

        • Daniel Maris

          Wind energy can be stored, for instance as pumped storage in hydro facilities or as methane (produced from air and water), the same as natural gas. Wind energy also makes a good bedfellow with solar energy because solar energy tends to be more plentiful on those (rare) days when the wind doesn’t blow due to high pressure being stationed over the UK.

          The idea that the Germans are going to run out of energy is ridiculous.

          • TomTom

            Well their Government seems to think so and is going to FORCE utiluties to keep coal-fired power stations running. It already faces lawsuits for BILLIONS over nuclear opt-out and the taxpayer is heading for a major payout………Germany is Europe’s largest consumer of energy and pensioners have already had a 20% cut in spending power since 2000. Besides, research in Germany shows modern over-insulated homes consume MORE energy than stone-built homes

            • Daniel Maris

              You obviously believe in the scatter gun theory of argumentation.

              1. So you agree Germany is not going to run out of energy (unlike the USA which has had significant power cuts). That’s what I said.

              2. The fact that the nuclear industry can hold a country to ransom like that shows what you are up against once you go down that road.

              3. Yes, Germany is the largest consumer of energy. Don’t you think it significant they are pursuing a 100% renewables strategy?

              4. I’ve no idea about whether stone insulates the best but insulation certainly reduces heat loss.

              • HJ777

                Are you suggesting that the Germans never make stupid decisions?

                • Daniel Maris

                  Nein. But I think they learnt a few lessons in the 20th century.

  • Daniel Maris

    The operating costs of green energy – lower than coal and nuclear, on a par with or better than gas.

    The problem that needs to be addressed is how to pay for the capital costs of building the green energy infrastructure.

    Instead of doing that by loading everything on energy bills we should be using QE and stamp duty tax receipts to develop green energy. As people sell their houses, the stamp duty receipts could be used to develop in situ green energy – usually solar – and energy efficiency (e.g. insulation). QE bonds could be used to raise the funds that enable the energy companies to shift to green energy.

    Once people are saving on energy bills and getting an income from their unused electricity generation, we will soon see a change in public attitudes.

    Germany is proceeding at a pace to develop green energy we need to follow that policy, though they too have created problems for themselves by loading the costs on to the energy bill payers.

    • HJ777

      First you claim that the operating costs of green energy are lower than coal or nuclear.

      Then you say that the cost of converting to green energy is being loaded onto energy bill payers in Germany. If it’s cheaper, as you claim, then there should be no extra cost to energy bill payers in Germany.

      Make your mind up.

      • dalai guevara

        Subsidies short term for energy independence long term.
        What is there not to like?

        It’s just not the mind set of short term thinking Britain.

        • HJ777

          We weren’t talking about “energy independence”, we were discussing costs.

          If the costs were lower long term, then energy companies would invest in ‘green energy’ without subsidies or extra costs to energy customers. Companies frequently invest long term if they think it will cut costs. If they need a subsidy to do it, then it probably won’t cut costs.

          • dalai guevara

            Yes we are! Developing non fossil local energy generation (wind, solar, tidal, geothermal) could lead to energy independence. The alternative is…war for oil (I thought you hated Bliar?).

            What is it then, hot shot? And don’t give me fracking, that receives tax breaks, just like the others you complain about.

            • HJ777

              You are discussing “energy independence” but that wasn’t the subject of the article nor of this comment thread. It was about the level of energy bills.

              In any case, just because you have “energy independence” it does not follow that you can “therefore control costs” – it may cost more (and probably will).

              I said nothing about hating anybody.

              • dalai guevara

                I rephrase: thinking short term about costs will give you no control long term over cost. Have a strategy, which for some is tax subsidising non fossil, for others subidising fracking and nuclear (true storage costs?).

                Take your informed and substantiated pick.

                • HJ777

                  If it would cut their long term costs, energy companies will invest without tax subsidies.

                  The idea that politicians know better than energy companies what future energy sources are likely to reduce costs and therefore should interfere in the market isn’t backed by either evidence or experience.

                • dalai guevara

                  Blimey, energy companies will give you a ‘puppy look’ whenever they can, and then report bumper profits a few months later.

                  It convinces only the short term thinker with the memory of a gold fish.

                • HJ777

                  That’s irrelevant nonsense.

                  If it cuts THEIR costs, why wouldn’t they invest in green energy? Lower costs means more profits for them, especially if they can get a march on their competitors.

                • dalai guevara

                  Let’s talk again once brent is at $300. I predict that will be in 2020. By then, the German federal state of Schleswig Holstein will have reached its target of generating 100% of its electricity demand through non-fossil sources. They have a minimal coast line, not comparable to the UK, nonetheless they produce 46.5% of what they consume today.

                • HJ777

                  I rather think that energy companies are more likely to be informed about what the future cost of energy is than you are.

                  If they foresee oil at $300 a barrel in a few years time then they will invest in alternatives.

                  Why do you think that you have more insight than they do?

                • dalai guevara

                  Mate, this is my business, it is my home turf – all political point scoring aside.

                  Energy companies in other countries have done exactly what you state – and to be frank – they would do it here too, if the customer would see sense.

                • Bob Hill

                  Because they are greedy bastards

                • Bob Hill’s Doppelganger

                  Pffffffffffffffffffffffffff! More methane from Thick Bob The Thatcher Hater. Pfffffffffffffff! Let it rip Bob. Tax that pea sized brain.

                • HJ777

                  If they’re greedy bastards, and if they could make more money in the future by investing in green alternatives now, then why wouldn’t they?

                  They’d stand to make more, wouldn’t they?

                  And if green energy really is cheaper, as is being claimed, then why are we offering subsidies to companies that stand to make more from green energy anyway? We should withdraw the ‘green energy’ subsidies – why subsidise their future profits?

                • dalai guevara

                  why.subsidise.fracking? why.subsidise.nuclear?

                  This nonsense has gone on for too long.,

                • Daniel Maris

                  Why does a three year old opt for the sticky bun now rather than the lamb chop in an hour’s time?

                • HJ777

                  You’re suggesting that the people running energy companies have the mentality of three-year olds, whereas you are all mature and grown up? Your contributions rather suggest the opposite.

                  The Channel Tunnel was built by private investment in the hope/expectation of a long term return. So were our railways and our canal network. It is governments that tend to be the short termists.

                  What you also forget is that there is an opportunity cost of government directing our resources (through subsidy) into renewable energy schemes. It means that same money cannot be invested elsewhere. Private investors, of course, will tend to invest in whatever they think will make the greatest return – and if they do, our economy grows faster and therefore provides even more money for investment. Government doesn’t work this way – they rarely think about opportunity costs.

                • Daniel Maris

                  Why should they, when they can simply pass on the cost to the consumer? They’ll watch what the other companies are doing. It’s like one of those cycle races that never starts, everyone’s just wobbling around at 0MPH.

                • HJ777

                  1. Electricity demand is not the same as energy demand. I use far more domestic energy from fossil fuels in non-electricity form than I do in the form of electricity.

                  2. France already produces about 80% of its electricity from non-fossil sources (just not from renewables).

                  3. The issue isn’t whether you can produce a large proportion of energy needs from non fossil or renewable sources – the issue is at what cost. Germans already pay domestic electricity prices which are 50% (pre-VAT) higher than in the UK and most of the difference is down to energy taxes levied to subsidise renewable energy sources. These taxes already cost the average German family over E250 per year.

                  4. SH may have a plan, but that isn’t the same thing as delivering it. We all know the history of government planning.

                • dalai guevara

                  1. We know that. That is why 300% might still not turn out to be a kWh/a surplus, but nonetheless a strategic vision.
                  2- France may change its mind soon. Stay tuned.
                  3- we know prices are higher in most of the EU. It essentially boils down to affordability. Germany does not have 50% of its pensioners on means tested benefits like we do.
                  4- even if they failed and only delivered elec(total) of only 200%, they would be in the position of selling to the grid rather than taking out of the grid. It is a totally different world out there and the gap is getting wider.

                • HJ777

                  “2- France may change its mind soon. Stay tuned.”

                  I won’t hold my breath if you don’t mind.

                  “3- we know prices are higher in most of the EU. It essentially boils down to affordability. Germany does not have 50% of its pensioners on means tested benefits like we do.”

                  Can you put that in English please? They pay more. Whether fewer German pensioners are, or are not on means tested benefits is neither here nor these – we are discussing energy prices.

                • dalai guevara

                  3- what I am saying is that every society will pay up to a certain amount for energy that they can afford.

                  Germany can fford more, they pay more.
                  UK can afford mid range pricing, they pay mid range.
                  The Ukraine, Jamaica et al cant afford much at all, they pay next to nowt/ don’t need much anyway.

                • Daniel Maris

                  Not true. As Dalai has shown, our energy investment is driven by short termism and the current set up does little to encourage a long term approach.The energy companies could well reduce their costs by pursuing wind energy over a 20 year plus period, but it’s a big investment to pursue in the short term.

                  The other point I would make is that by developing energy independence we can ensure that the energy economy forms part of our own economy. In those circumstances “energy costs” are also “energy jobs” for our people.

                  Another bonus of course is clean air – with huge savings on lung disease.

                • HJ777

                  Dalai has shown nothing of the sort. He/she has just asserted a whole lot of things (mainly nonsense) and has presented no evidence whatsoever.

                  Why wouldn’t the energy companies invest in the short term if it meant bigger long term profits? Companies do this all the time.

                  Justifying this by saying that it creates domestic jobs is nonsense. If other people have to pay more to create these ‘green energy jobs’ then it will cost jobs elsewhere in the economy. Next you’ll be saying that we should grow our own bananas in greenhouses heated by wind power because it will create banana grower jobs here.

                  Germany, as you are obviously not aware is having to import huge amounts of electricity from France because it has invested heavily in (unreliable) wind power and is shutting down its nuclear plants. It’s a disastrous policy.

                  I am as much in favour of renewable energy as the next man, but not if it leads to unreliable supply and needs huge taxpayer (or energy tax) subsidy.

                • Daniel Maris

                  It’s very difficult to get companies to invest in long term infrastructure if they can get short term guaranteed profit in a cartel situation which is more or less what we have here.

                  Germany is on the path to 100% renewable energy. You can’t do that overnight. Are you aware they are installing about 10Gw of solar power per annum?

                  Nuclear is unreliable – ask the French who had to shut down several of their reactors in the long hot summers around 2000. New nuclear is very expensive and has already been subjected to huge cost overruns.

                  We know as well from Japan what terrible consequences can occur when nuclear goes wrong. Nuclear is a top terrorist target. Even if we haven’t had a tsunami in the UK in 400 years we can’t guarantee terrorist won’t succeed in attacking a nuclear plant.

                  I really don’t think green energy will lead to unreliable supply. The Germans are far too clever for that. They will manage things through pumped storage in hydro facilities, increased generation in non-wind and non-solar green energy facilities, and storage of wind and solar as methane.

                • dalai guevara

                  ‘…has asserted a whole lot of things, mainly nonsense.’

                  Look at the EON or RWE renewables investment programmes, compare it to anything that goes on here, and then get back to me. You may use the interweb to retrieve this information.

                  It is you who has not presented one single fact.

                • HJ777

                  I did not suggest that I had presented any facts.

                  My points were about incentives and motivation. If the returns available from investing in supposedly cheaper renewable energy sources were worthwhile, then energy companies would have an incentive to invest upfront – without needing subsidies. So they’d do it anyway. You still haven’t explained why they would not be motivated in this way if they could make a worthwhile return on the investment.

                  I’m not saying that companies don’t (or shouldn’t) have renewables investment programmes. What I’m saying is that were they worthwhile they’d invest in them anyway. At the moment, many do so only because renewable energy investment is subsidised and/or they are guaranteed a higher price for renewable energy (or are fined if they don’t include a certain proportion of renewable energy). What’s worse, many of the subsidies are very specific and rely on government picking renewable energy ‘winners’ – and we all know the record of governments picking ‘winners’, don’t we?

                  As for Desertec – were you unaware that even its proponents recognise that its viability is highly dependent on the level of subsidies available?

                • dalai guevara

                  I do not understand your inability to grasp the concept of upfront cost financing to establish game-changing ways to overcome old encrusted structures and establish new, more suitable ones. R&D in any private business environment works like that, immigration and family policy follows this principle when you look on the state side.

                  Encourage development by sponsoring/subsidising things, discourage it by taking funding away from it. Private companies will invest if they see the political backbone to support change. They are doing that on a massive scale in our places.

                  We are not delivering this message. We are delivering what message exactly?

                • HJ777

                  ” I do not understand your inability to grasp the concept of upfront cost financing to establish game-changing ways to overcome old encrusted structures and establish new, more suitable ones. R&D in any private business environment works like that…”

                  I understand the concept perfectly, but as you say, in a private business environment they will invest in R&D if they see the prospect of such an advantage. And if they don’t see the prospect of such an advantage, they won’t. In which case, why do you want to throw subsidy at them?

                  You think they rip us off, yet you want to give them taxpayers money! Of course they’ll accept it – rather than spend their own money. I would! If gullible people want to give me their money, why would I refuse?

                • dalai guevara

                  ‘You think they rip us off’ – well what would you call the YOY increase in profits since 2007? Facts, please.

                  ‘And if they don’t see the prospect of such an advantage…’ – wrong, I explained it’s about political backbone, not tokenism. I would not invest a single penny if I saw token clowns in action. Sorry, but I am out because of what I see.

                  I am afraid we are going round in circles. We need three things:
                  1- a vision,
                  2- a clear commitment to something, not a today this tommorrow that approach – my example of the North German coalition agreement (2012-2017) where they want to be in 2012 is such a commitment.
                  3- the protection of the vulnerable consumer

                  I for one can see neither 1,2 nor 3 delivered right now.

                • HJ777

                  I was not commenting on whether they do or do not rip us off.

                  Let’s assume that you are right and they do. Why then do you want to hand them more of our money?

                  Spare me government-imposed “vision”. The Euro was the result of a “vision”. So was communism. So was DeLorean. So were Soviet Union 5-year plans.

                  It is fine for people to have vision. There have been many successful examples throughout history. In recent times we might point to Steve Jobs or Dyson, and going back in time, Brunel. The point is that they did it with their money or money that they persuaded willing investors to part with. They didn’t forcibly take money from us through taxes and then spend it without any responsibility for making a return.

                • dalai guevara

                  I have always advocated either to implement competition (we do not have that) or nationalisation (we do not have that). What we have is private profiteering on yet another essential public service where no competition is measureable. If we went for the ‘proper competition option’, that would not discredit the approach of subsidies (German model). If we went for the ‘nationalisation option’, all would be in the hands of one regulator (Venezuelan model).

                  Unlike many believe, it is the western business and financing model that is currently failing, not just the Euro. Please include the US and the UK in your analysis. The irony is that the five year plan is something we have appeared to have picked up (unquestioned?) from the Communists.

                  Brunel, Dyson, Jobs: wrong, all three have worked in an environment of either Manchester Capitalism or now part-regulated capitalism, which clearly incentivised certain behaviour and discouraged others. The ‘social market economy’ is different to that in the sense that it includes the state regulator more actively and demands ethical behaviour from both sides. Please note that its origins derive from a conservative viewpoint.

                • HJ777

                  There is just too much deluded nonsense in your posts to keep answering them. You believe what you want to believe.

                • dalai guevara

                  No, you are just neither making a case for proper unregulated capitalism, nor nationalisation – that is all. Are you making a case for the ‘well working’ status quo?

      • Daniel Maris

        You don’t seem to understand the difference between capital costs and operating costs. The operating costs of green energy technologies are low for the most part: hydro, tidal, wind, and solar all have v. low operating costs. In fact French tidal energy is the cheapest in Europe.

        What’s happening now is that the companies are having to fork out huge amounts now to put green energy technology in place and those costs are being loaded on to energy bill payers. It’s as if when we first developed our motorway system in the UK all the costs of that had been put on to the price of petrol. Fortunately the governments of that time were more sensible and funded the costs through general taxation.

        • HJ777

          Oh lordy – I’m being lectured on business costs by Daniel Maris (who has no experience of business).

          I have worked most of my career in an industry that requires large upfront research and capital investment (the semiconductor industry) – which has become an ever more significant part of total production costs.

          The cost of the final product includes the amortised upfront investment – this is factored into account when calculating the real production (i.e. operating) costs.

          The day-to-day fab operating costs of Intel are surprisingly low compared to the upfront investment (which must be financed from the sale of products). The idea that you should only worry about operating costs is laughable.

          As for building motorways (most in France are privately built) – the operators invest upfront and recover the investment through user charges. Although the system is less transparent in the UK, that’s why we pay more in road tax and fuel duty than it costs to run the network.

          • Daniel Maris

            How do you know I have no experience of business? I do actually. I worked for many years in a business that required v. large and long term capital investment up front. I am fully aware of the principle of amortisation. But one thing I can tell you: those concrete platforms and towers that house the wind turbines are going to last a lot longer than 20 or 25 years. When it comes to renewal, we will be talking essentially about the turbines – which are only about 20% of the overall cost.

            The price of wind energy will plummet in a couple of decades, just as the cost of tidal energy plummets once the initial investment is paid off.

            What I am saying is that we should view our energy infrastructure in the same way we viewed our motorway network 50 years ago (and most motorways in Europe were financed the way ours were). We should invest in it and achieve energy independence and a boost to your local economy. It may mean some other capital investments get a lower priority for a few years. So be it, is what I would say. But we can fund this relatively painlessly in ways that people will see a direct and immediate benefit.

            • HJ777

              Ever heard of Net Present Value?

              Even if I were to accept your argument about lower long term running costs (and I don’t, not least because you haven’t considered the costs of supplying (lossly) storage capacity for unreliable wind turbine electricity generation), that doesn’t mean that it’s a better deal overall.

              It has to be very much cheaper in 25 years time in order to justify high investment now.

              The energy companies can make this calculation without your help. You, however, just want to throw taxpayers money at them in the form of subsidies. I thought you didn’t trust the energy companies not to rip you off – why do you want to give them our money on a plate?

  • El_Sid

    Another example where we are suffering the consequences of the lack of long-term thinking by the last government on things like nuclear power and the huge shift from being a gas exporter to a major gas importer within a few years. They had a vague hope that some LNG would turn up – it’s never cheap at the best of times, but recently it’s being sucked off the market by Japan, who has a desperate need for energy after the tsunami closed down all their nukes. That’s just one aspect of a wider trend – the recovery from recession is being slowed massively by the fact that it is happening at a time when new powers are emerging in the world economy. It’s similar to the Long Recession of the late 19th century, where traditional powers like Britain struggled as the likes of Germany and US sucked in huge amounts of resources and capital.

    However we are where we are, and the fact is that there are no quick fixes. UK wholesale electricity prices need to go up 40% to justify building any kind of new power plants – gas, nuclear and many kinds of renewable. At the moment we’re barely covering the operating costs of what we’ve got – for instance Centrica’s gas plants are only running at 28% load factor, similar to the much-derided wind farms.
    Shale gas isn’t the answer – at least not for cheap gas. It helps with energy security and that’s always a good thing, but it doesn’t make gas cheaper. In fact far from being a success story the US gas industry is a bloodbath right now – poster child companies of the shale gas revolution like Chesapeake Energy (CHK) are in big trouble. Estimates vary but headline wholesale prices would probably have to double to make dry shale gas sustainable in the long term in the US. You can also look at the US gas rig count which has just collapsed in the last 5 years.

    What’s driving low gas prices in the US is not “conventional” dry shale gas, but the high oil price pushing a big investment in new oil fields. Basins such as the Eagle Ford have quite a lot of gas mixed in with their oil and so this gas has been dumped on the market pretty much as a waste product. So yeah, if we can find some Eagle Ford type basins here then great – I have my suspicions that Cuadrilla are aiming for the corner of the Blackpool basin that is most likely to be more oil than gas.

    Stuff like the lowest tariff stuff and even fiddling with green subsidies is just rearranging the deckchairs on the Titanic – it’s visible but it doesn’t fix the underlying problems. If government wanted to really do something useful then they should consider recycling their QE-cheapened debt as project finance for new power stations, nukes in particular. For all the opprobium aimed at the power companies, they are in trouble, they have massive capital requirements and are struggling to finance them (why should investors invest in power stations in Europe when they could get better returns investing in the BRICs? It’s back to that competition for capital thing). And government should also consider more by way of encouragement to householders/landlords/companies to reduce the energy running costs of UK plc by way of insulation etc.

    But you can’t buck the market – and the electricity price is going one way.

    • Bob Hill

      Yes and who was it who sold all the utilities for pay for all the unemployment her policies had created

      • Bob Hill’s Doppelganger

        Pfffffffffff! The sound of more methane escaping from a backside pretending to be a brain. Love your comments “Bob”. Another thick socialist troll – just what we need!

  • HooksLaw

    Gas prices generally fell earlier in the year. Last year there were even bigger increases.

    Its winter and demand for gas is high. Our prices reflect the demand for oil and gas in Europe.
    Most of Europe seems to pay more than we do.

    • AnotherDaveB

      EDF point the finger at HMG green energy policy.

      “The company has seen a sharp increase in costs since the start of the year, with transmission and distribution charges rising by 9%, and the costs associated with the implementation of obligatory renewable, energy efficiency and social schemes increasing by more than 50%. The cost of buying energy has also risen by 4% for next year … The cost of buying energy accounts for around 50% of a typical energy bill. The other half is made up of non-energy costs.”

      • El_Sid

        the costs associated with the implementation of obligatory renewable, energy efficiency and social schemes increasing by more than 50%
        Sounds dramatic, no? But that’s just the Reg swallowing corporate spin. The fact is that all of that stuff is a negligible proportion of the final bill – about 4% on average. So you could wipe out all of those nods to “externalities” and it would still only cover inflation in energy costs for one year.

      • dalai guevara

        Thanks for explaining to us the concept of…bumper profiteering.

    • dalai guevara


      1- gas/oil prices are nowhere near the $150 when recession hit, nonetheless energy prices have now easily doubled since then.
      2- it is only now that energy suppliers are repeatedly reporting YOY increases in profits. How do they do that?
      3- yes, most of Europe pays more, but

      3a- Spain requires less heating in winter
      3b- Germany, Scandinavia, Holland et al have a far superior housing stock. If you look at the average household consumption levels for gas in the UK in kwh/a, you could heat an entire street in Norway with that.

      • Daniel Maris

        3a and 3b are v. pertinent points.

    • Bob Hill

      most of bloody Europe are better paid to start with!!

  • Colonel Mustard

    I think we should all be very concerned at the methane generated by the socialist trolls infesting this site.

    • Bob Hill

      hopefully it will blow the likes of you to pieces

      • Bon Hill’s Doppelganger

        Pfffffffffff! More methane from Thick Bob the Thatcher Hater.

    • dalai guevara

      If anyone comes out and suggests that the doubling of energy prices
      since the crash is explained by the wind turbine subsidies, please note:
      you are in danger of me getting up out of my chair and coming over to
      smash your face in!

  • james102

    Yes as has been written before it is the difference between wage increases and inflation that tends to give a general feeling of whether times are good or bad, not GDP.

    Energy costs are a significant factor in increasing inflation.

    The problem for the political class is there is a conflict between their fashionable views on the environment and manmade global warming and the priorities of the average member of the electorate. The more they talk about carbon taxes and “Green” initiatives the closer the average taxpayer grasps their wallet, as they know it will cost them.

    Like ministers photographed on bikes, it is a very limited audience that finds it anything but ridiculous, unfortunately many of them work in PR.

    • Daniel Maris

      It’s not just wages, it’s wages minus outgoings that is key. It’s what’s left after all taxes, pension contributions, housing related costs, transport and communications that affects how people feel about the economy.

      The reality is that many people (obviously not the super-rich) have suffered a 25% reduction in their disposable income in the last four years.

      I don’t think it’s going to get better as long as we pursue the misguided policies of global free trade, EU membership, mass immigration, huge population increase and prioritising finance.

      In fact I think it is going to get worse. We are already seeing the negative impacts of mass immigration.

  • James Cunningham

    The more we see stories like this the more we should be looking into energy saving measures. Loft insulation, low energy lighting, solar panels etc. That way we can protect ourselves from rising bills.

    • BuBBleBus

      My sister recently had some solar panels on the roof. Cost her 10grand which she hopes to recoup over a period of X years (depends on interest rates). OK if you can get the credit and want to take the risk (and expect to stay under the same roof for that many years). Can’t imagine there’s many without loft insulation these days. Of course the real answer is to switch off the lights, and heating and don those warm woolies grandma knitted for you in another age.

      • El_Sid

        “Can’t imagine there’s many without loft insulation these days.”
        You’d be surprised. There’s over 10 million houses with lofts that have less than 125mm of loft insulation, and from memory it’s something like only 30% of all houses with lofts have 8″ or whatever the reccommended amount is.

        • alexsandr

          yeah and what do you do with all the stuff stored in lofts while you pile that insulation in? I don’t fancy emptying my loft, taking up the floorboards, then putting it all back after.

          • alexsandr

            and anyway, why bother when we light empty motorways, many biuldings are floodlit, no-one turns lights off at work and shops leave their doors open and the heating on when its freezing outside.


    The more articles we see like this the more reason to look at investing in energy saving measures. Insulation, lighting, solar panels, etc. That way you can protect yourself from rising fuel bills.

    • dalai guevara

      well, you see the public response – it appears that trusting Stalin and war for oil is the legitimate alternative.

  • alexsandr

    cameron has to do 3 things
    stop the green subsidies adding to our energy bills
    cut the VAT on domestic fuel
    get this shale gas exploited


    • bloughmee

      He needs to do a 4th thing, as well, the most important thing: Arrest King Mervyn and destroy his printing press.

      Inflation will out, eventually. You can’t do what’s been doing and not expect inflation to arise. That’s what happens by definition.

      • George_Arseborne

        I thought King’s printing press was the fault of last Labour government . Eh!?

        • Heartless etc.,

          But used with relish by the present disreputable gang of knaves!

      • Bob Hill

        He should arrest himself and osborne first

    • The Sage

      Agreed! 100%

    • HJ777

      He can’t cut the VAT on domestic fuel because of EU agreements.

      In any case, it is only levied at 5%.

      In my view VAT should be levied more widely which would allow a lower rate on everything. I do not see the case for a lower rate on fuel specifically.

      • TomTom

        Like Medicines as in Germany ? Or water perhaps ? Maybe on books and newspapers ? How about levying it on Student Tuition Fees ?

        • HJ777

          Yes, why not?

          One man’s tax exemption is another man’s tax increase.

      • alexsandr

        ‘He can’t cut the VAT on domestic fuel because of EU agreements.’
        or he could tell the EU to eff off…

    • dalai guevara

      Cameron has to do three things
      1- create competition in an industry where no competiton is currently measureable
      2- nationalise it if he cannot do 1
      3- stop tax breaking fracking, I thought it is our saviour?

  • Rhoda Klapp

    It is government policy that has pushed up bills. Incontrovertibly, and of successive governments. Soon they will combine that stupidity with a failure of supply. All this has been known for years, but nobody holds them to account for it, Stupidity is piled on stupidity. Where are the media in this? Complicit.

  • Bruce, UK

    “green energy policies”

    Tautology central.